Capitalist Values

March 06, 2006
In defense of capitalism, and some real black history...

Great essay in the current Atlantic by Clive Crook, marveling at how little "awe" we have for the success of the free market and it's comcomitant freedoms. It's called "Capitalism: the Movie" on page 46 of the March issue. Nice to have a good reminder that if we take what we enjoy a little too much for granted, we are in danger of letting it slip away. His point is basically that there is an underlying assumption in our culture (demonstrated through the movies) that business and the free market is a bad thing, and the heroes are the ones who escape being downtrodden by it. He ends with this paragraph:

How about a movie in which a firm prospers under threat of competition by selling things that people want at an affordable price, paying its workers the market wage, and breaking no laws, thereby advancing the common good? Well, you see the problem.

. . .

This contribution from David is what I love about David.

He makes two claims here:
1. Our movies demonstrate a fierce anticapitalist current in American (U.S.) society.
2. Individual capitalist agents who obey the rules of the marketplace are not the vicious villains the popular media portray them as but, rather, the heroes of our civilization who advance the common good.

Why do I love this stuff from David? Because it gets at the core of GTD and what distinguishes GTD from Covey.

What would Covey have us do? He would preach to us about integrity, honesty, win-win, and paradigms of interdependence.

What does David do? He does not ask what the intentions are of the heroic capitalist. He does not ask what values the capitalist hero holds or what character ethic this captain of industry represents. David recognizes what Adam Smith recognized in 1776: if we structure our social system according to market principles then it's good to act as selfish, egoistic, money-grubbing individuals. Or, as Gordon Gekko said in "Wall Street" (the movie), "Greed is good."

David approvingly quotes Crook who describes capitalists as advancing "the common good." But of course the secret of capitalism is that capitalists need not intend the common good in order to advance it. In fact, capitalism is constructed on the assumption that individuals will not will the common good, they will will their individual good.

Of course, I don't find it odd that there are oases of cultural expression where greed is traduced rather than celebrated. I would certainly not, however, characterize popular U.S. culture as anticapitalist. In the U.S. today Donald Trump is a cultural icon. He slaps his name on buildings all over Manhattan, casinos, and TV shows. Martha Stewart was temporarily slowed down by her imprisonment for obstruction of justice but she was returned with her star shining brighter than ever. In fact, she and the Donald battle it out for the premier position of celebritydom.

GTD reflects our free market popular culture. Work from the bottom up. Covey represents a delusion. Covey wants to sell his products to the big corporations that pay the big consulting fees. He feeds them anodyne maxims from the wisdom of the ages. They pay him to feel good by writing noble mission statements. The reality is that the capitalist ethic is be selfish, be greedy, and the masses will benefit.

David approvingly quotes Crook who describes capitalists as advancing "the common good." But of course the secret of capitalism is that capitalists need not intend the common good in order to advance it. In fact, capitalism is constructed on the assumption that individuals will not will the common good, they will will their individual good.

Capitalism only advances the common good when it is forced to do so by other agencies. Consider the efforts of antitrust regulators to tame the excesses of Standard Oil, and the efforts of unions to moderate the worst impulses of Big Steel. You mention "the rules of the marketplace" in passing, but in fact those rules are just as important to capitalism as money-grubbing individualism. Without rules, you get child labor, filthy cities, and dirty dealing that makes Enron look like a child's Monopoly game.

Comment

I didn't find him preachy. I got great value out of The 7 Habits. I still utilize "Begin with the end in mind."

Originally posted by moises

Covey represents a delusion.

I don't see that in the things I learned from his courses.

Originally posted by moises

But of course the secret of capitalism is...
In fact, capitalism is...

There may be more than one kind of capatilism, and more than one way to apply it in ones life.

Originally posted by kewms

Capitalism only advances the common good when it is forced to do so by other agencies.

I could easily be defined as a capitalist, and I run a business, and I make good dough, but there's no way this statement would fit me. I certainly don't advance the common only good when an outside agency forces me to do so. I advance it all the time, and it has nothing to do with being, or not being, a capitalist.

Comment

I could easily be defined as a capitalist, and I run a business, and I make good dough, but there's no way this statement would fit me. I certainly don't advance the common only good when an outside agency forces me to do so. I advance it all the time, and it has nothing to do with being, or not being, a capitalist.

I was referring to capitalism as a system, not individual capitalists. Individuals can, and often do, value things other than the pursuit of wealth. Capitalism as a system does not. (Don't believe me? Just look how the market rewards companies that do things like dump their pension plans or cut employee health insurance.)

Comment

From the magazine Against the Current January/February 2006. The article "Hegemony and Resistance" by John Vandemeer, page 43.

[Henry Ford is reported as saying] "I do not believe that we should make such awful profits on our cars . . . A reasonable profit is right, but not too much." As a consequence he slashed prices on the Model T and raised workers wages.

But the Dodge brothers, major shareholders in the Ford Company, had big plans to build their own car company, using the dividends from their shares in Ford. When Ford decided to cancel the dividends in 1916 in order to provide lower prices for his customers, the Dodge brothers brought him into court arguing that "Profts belong to the shareholders . . . and Ford had no right to give their money away to customers, however, good his intentions." The judge agreed.

The court's decision pointed out that a (publicly held) business corporation could not be run "for the merely incidental benefit of shareholders and for the primary purpose of benefiting others."

Comment

I don't quite see any of this discussion as demonstrating the inherent superiority of GTD or David Allen's particular virtues, but here's my $0.02, inflation adjusted to $2.57. I don't want to discuss what defines capitalism is or is not, because every right-thinking American is for capitalism- by his or her definition.

It seems to me that many of the issues we as citizens face concerning modern corporations is that corporations have many of the privileges of citizenship, but not the responsibilities. As has been pointed out here, corporations have a duty to maximize profitability on behalf of shareholders. This can lead to actions which are not in the best interests of consumers, citizens, towns, states, nations, and the world. While corporations often influence political processes more effectively than citizens, it is citizens (and their elected representatives) who have the responsibility to juggle what is best for everyone. It is completely natural that modern corporations would use every legal means available to stifle competition and make profits. Thus, for example, we have RIM paying hundreds of millions of dollars to a company whose only purpose is to obtain fees from other companies for dubious patents.

In my home state of Missouri, some towns have assigned taxation powers to developers, who levy an extra sales tax on shoppers to provide for traffic lights, roads, and other infrastructure at their developments. We have also had a nasty incident with tax-increment financing and eminent domain.

I am for free enterprise, but to give corporations the rights of citizens and the powers of government without the concommitant responsibility and accountability is in the long run harmful to a free society.

Comment

David Allen must cringe when he reads some of the posts on this forum that extoll him as the true prophet of everything from personal productivity to (here) economics. He must especially love it when he reads about how the true church of GTD totally stomps on the false religions of values and integrity-based philosophies.

Comment

Its a complex area, but there is no such thing as "The Free Market" or even "Free Trade". Its completely regulated and controlled, biased, and locked-up.
Down at the level of a lemon-aid stand some of those ideas apply.

But when you start dealing on a macroecomic, political, and multinational level, the concepts of Free Market and Free Trade are simply meant as ironic humor.
So-called Capitalism, seems to me, does not even exist.The US Gov't subsidizes the core of the entire US economy, through the high-tech military system, and other regulations of the economy.

Comment

I am for free enterprise, but to give corporations the rights of citizens and the powers of government without the concommitant responsibility and accountability is in the long run harmful to a free society.

This was one of the points made by "The Corporation" (excellent movie). Corporations have many of the same legal rights as individuals, but because they are strictly a legal entity (not an individual), they don’t have the sensibilities of an individual (such as a conscience, a concern for their personal safety, or a sense of belonging to a community).